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The State Bank of Pakistan (SBP) has granted relaxation to rice exporters under Export Finance Scheme (EFS) for FY17. According to SBP H&SMEFD Circular No. 06 of 2017, in view of the particular circumstances impacting rice exporters in meeting their required export performance, some relief is being provided to rice exporters under EFS for fiscal year 2016-17.

As per granted relaxation, under EFS Part-I (Pre-shipment) 90 days extension in shipment period has been allowed for those Part-I loans, in which shipment was falling due in FY 2016-17 (July-June basis). In case of non-shipment, the fine already charged will be retained by SBP BSC offices till submission of Annexure-F within extended period. However, in loan cases where the shipment was falling due during FY 2016-17 and delayed shipment fine had been charged, upon submission of Annexure-F, the same will be refunded to the extent of delay by a maximum 90 days.

Under EFS Part-II relaxation, an additional period of 3 months has been allowed to those rice exporters who have shortfall in required performance in the monitoring year 2016-17. Accordingly, eligible entries showing shipments and export proceeds realization up to September 30, 2017 are allowed to be included in the export performance of FY 2016-17.

This export performance of extended period will also be considered for entitlement of limit for FY 2017-18. However, it is expected that exporters will avail realistic limits from banks in line with their potential to perform in order to avoid short performance fine in FY 2017-18. Exporters requiring relaxation will have to submit additional EF-1 and EE-1 statements through their banks to respective SBP BSC office latest by December 31, 2017, duly verified by the concerned Foreign Exchange Operation Department/Division (FEOD).

In addition, exporters, who avail above benefit of extension in performance period, will not be allowed to avail benefit of incentives based rebate of mark-up for the year 2016-17. All other instructions on the subject will remain unchanged, the SBP said. Meanwhile, Mahmood Moulvi, Chairman, Rice Exporters Association of Pakistan (REAP), has appreciated the relaxation announced by the SBP saying that this move will help increase rice exports, which are already facing stiff competition in the world market.